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2017-01-12 14:36:52

NFLX

Netflix

$130.50

0.61 (0.47%)

, AAPL

Apple

$119.75

0.64 (0.54%)

…14:36

01/12/17

01/12

14:36

01/12/17

14:36

Analysts bullish on Netflix into 2017 as Apple said developing TV shows

Wall Street analysts have been weighing in on Netflix's (NFLX) 2017 prospects in recent days after the stock struggled to beat the market last year, with Morgan Stanley forecasting accelerating subscriber growth and JPMorgan expecting a "cleaner" investment thesis for the new year. The bullish calls come amid ongoing evolution in the TV and media industry which has, among other things, reportedly driven Apple (AAPL) to dip its toes into original content production and spurred speculation of Disney (DIS) launching a bid for Netflix, which Credit Suisse this week called unlikely. MORGAN STANLEY SEES SUBSCRIBER ACCELERATION: Morgan Stanley's Benjamin Swinburne reiterated an Overweight rating on Netflix while raising his price target to $150 from $130 on Thursday. The analyst challenges consensus expectations and calls for U.S. and international subscriber additions to accelerate in 2017, particularly in the second and third quarter, with Swinburne citing reduced churn as the "un-grandfathering" issue falls off; the company's continued commitment to original programming, which appears "highly correlated" with engagement; recent set-top box distribution partnerships with Liberty Global (LBTYA) and Comcast (CMCSA), whose "X1" could become North America's platform of choice; and the newly-implemented ability to download certain Netflix content, which should be particularly appreciated by emerging market customers often subject to Internet data caps. JPMORGAN SEES 'CLEANER' 2017: JPMorgan's Doug Anmuth reiterated Netflix as his number two large-cap Internet pick, saying Wednesday that the stock is set up for a "cleaner story" in 2017 with pricing friction behind it and original content nearly doubling to over 1,000 hours. The analyst argues that both U.S. and foreign subscriber additions "could" accelerate versus 2016, adding that, while he doesn't view Netflix as a seller, the company remains a "highly strategic asset." CREDIT SUISSE SAYS DISNEY TAKEOUT UNLIKELY: Credit Suisse's Omar Sheikh argued Tuesday that it's "hard to justify" an acquisition of Netflix by Disney. The analyst explains that improving industry trends have eased the strategic pressure on Disney to buy a distributor and the hypothetical deal's dilution to financial performance "would be prohibitive" at Netflix's current levels. That said, Sheikh concedes that the AT&T (T)-Time Warner (TWX) merger, continued growth in over-the-top services, and looming sports rights renewals in 2021-2022 mean that simply maintaining Disney's current structure is "not risk-free" over the long term and will continue to spur debate on potential strategic moves. APPLE MOVES INTO ORIGINAL CONTENT: The Wall Street Journal reported Thursday morning that Apple plans to develop a "significant" new business in original TV shows and movies. Sources quoted by the publication noted that the programming would be available to subscribers of Apple's music streaming service, adding that the company has told Hollywood executives that it hopes to launch by the end of 2017. The Journal noted that, given the initiative's relatively limited scope, "it doesn't appear" Apple is setting up to spend on the level necessary to directly compete with Netflix, Amazon (AMZN) and other names in the space, and is instead looking to gain an edge against music service Spotify. PRICE ACTION: Shares of Netflix are down 0.5% to $129.80 in afternoon trading after hitting all-time highs earlier this month.

JPMorgan analyst Doug Anmuth says Netflix (NFLX), his number two large-cap Internet pick behind Facebook (FB), sets up as a "cleaner story" into 2017. Pricing changes are behind the company while revenue accretion will be realized from higher selling prices and global profitability is increasing, Anmuth tells investors in a research note. He thinks Netflix can add more U.S. and international subscribers in 2017 than 2016 and expects the stock to outperform. The analyst has an Outperform rating on the stock with a $140 price target.

01/10/17

FBCO

01/10/17NO CHANGETarget $125FBCOOutperform

Disney deal for Netflix 'hard to justify' at current levels, says Credit Suisse

Credit Suisse analyst Omar Sheikh weighed in on the debate as to whether Disney (DIS) should bid to acquire Netflix (NFLX), concluding that the dilution to earnings, free cash flow and to returns at the current share price would be prohibitive. Additionally, the strategic pressure to acquire a distributor is moderating with industry trends improving, Sheikh tells investors. However, this debate is unlikely to go away, given the pending merger of AT&T (T) and Time Warner (TWX), the continued growth of subscription video on demand aggregators and Disney's upcoming sports rights renewals, adds Sheikh, who keeps an Outperform rating and $125 price target on Disney shares.

01/12/17

MSCO

01/12/17NO CHANGETarget $150MSCOOverweight

Netflix price target raised to $150 from $130 at Morgan Stanley

Morgan Stanley analyst Benjamin Swinburne believes Netflix churn will fall year-over-year both in the U.S. and internationally, aided by the company's original programming success, and expects net subscriber additions to accelerate, both domestically and abroad, while the consensus forecast is for deceleration in net adds. Swinburne is forecasting U.S. net adds of 4.3M and international net adds of 13.3M in 2017. The analyst, who said he would be a buyer on any material pullback, raised his price target on Netflix to $150 from $130 and keeps an Overweight rating on the shares.

01/10/17

JPMS

01/10/17NO CHANGETarget $165JPMSOverweight

JPMorgan reiterates Facebook as top large-cap Internet pick

JPMorgan analyst Doug Anmuth reiterates Facebook (FB) as hit top 2017 large-cap pick in the Internet space with an Overweight rating and $165 price target. Despite rallying 9% year-to-date, and trading only 6% below its all-time high reached on October 24, overall enthusiasm toward Facebook shares "remains somewhat muted," Anmuth tells investors in a research note. Concerns around revenue deceleration, slowing ad load growth, fake news and ad metrics have contributed to the "recent wall of worry," the analyst contends. Anmuth views the fears as largely overdone and thinks they create a good buying opportunity. The analyst also likes Netflix (NFLX) and Alphabet (GOOG) among large-caps and Yelp (YELP) and Match Group (MTCH) among small- and mid-caps.

AAPLApple

$119.75

0.64 (0.54%)

01/09/17

DRXL

01/09/17NO CHANGEDRXL

Apple remains underappreciated, says Drexel Hamilton

Drexel Hamilton analyst Brian White said all the companies in his Apple Monitor have reported December sales that came in better than historical seasonality. Final December sales for the Apple Monitor fell by 2%, but were better than the average decrease of 11% over the past eleven years, and compare favorably to the five year average of down 6%. White believes Apple is one of the most underappreciated stocks in the world. Near-term, the analyst expects Tim Cook to make Apple grow again in Q1 on the back of the iPhone 7 and a happy holiday season, while he looks forward to the launch of the iPhone 8 in September 2017 and more color on future innovations. Additionally, White said potentially favorable tax repatriation policies could act as a positive catalyst for Apple shares. The analyst rates Apple a Buy with a $185 price target on shares.

01/09/17

MSCO

01/09/17NO CHANGETarget $148MSCOOverweight

Apple called a top U.S. IT Hardware pick for 2017 at Morgan Stanley

Morgan Stanley analyst Katy Huberty named Apple as a top pick in U.S. IT Hardware in 2017, saying that the market is "focusing too much on near-term supply chain noise" and not enough on the upcoming iPhone supercycle along with the potential positives of cash repatriation and U.S. tax reform. Of these, Huberty believes the iPhone supercycle is most debated by investors who see China as a risk, but her view is that consumer loyalty to Apple remains high in China. Huberty has an Overweight rating and $148 price target on Apple shares.

01/12/17

WELS

01/12/17NO CHANGEWELS

Apple fiscal 2017 estimates lowered below consensus at Wells Fargo

Wells Fargo lowered its fiscal 2017 revenue and EPS estimates for Apple significantly below Street levels. The firm says that its December checks showed that supplies of most models of the iPhone 7 and iPhone 7 Plus were either "readily available" or "reasonable" in the U.S. Wells thinks this may indicate that demand for the devices dropped. It believes that the company's guidance for its March quarter could miss expectations, and it keeps a Market Perform rating on the stock.

After a survey of middle-class smartphone purchasing intentions in Tier 1-2 cities in China, CLSA concluded that smartphone demand among respondents is basically flat with last quarter, iPhone demand among aspiring upgraders is also flat, iPhone loyalty has weakened and Xiaomi and OPPO have gained traction. Citing reports of weaker build plans and a more cautious outlook in China, CLSA analyst Avi Silver lowered his March quarter estimates and cut his FY17 EPS estimate for Apple to $8.39 from $8.99. However, he also raised his FY18 EPS view to $10.46 from $10.25 and increased his price target to $137 from $130, citing recent multiple expansion. Silver keeps a Buy rating on Apple shares.

DISDisney

$107.81

-1.63 (-1.49%)

01/12/17

01/12/17DOWNGRADE

On The Fly: Top five analyst downgrades

Catch up on today's top five analyst downgrades with this list compiled by The Fly: 1. Disney (DIS) downgraded to Sell from Hold at Pivotal Research, while the firm downgraded CBS (CBS) and Discovery (DISCA) to Hold from Buy. 2. KB Home (KBH) downgraded to Sell from Hold at Evercore ISI with analyst Stephen Kim saying shares appear overvalued relative to his $14 price target, especially since it should not benefit as much from lower U.S. corporate tax rates as peers. 3. Northrop Grumman (NOC) downgraded to Hold from Buy at Jefferies with analyst Howard Rubel saying he's become more selective for the Aerospace & Defense Electronics space with valuations and expectations higher post the U.S. election. The analyst lowered his price target for Northrop shares to $243 from $260. His top picks are Boeing (BA), General Dynamics (GD), Textron (TXT) and DigitalGlobe (DGI). 4. Magellan Midstream (MMP) downgraded to Outperform from Strong Buy at Raymond James with analyst Darren Horowitz citing valuation and saying its ultra-defensive characteristics, may result in shares lagging peers as oil prices continue to recover throughout 2017 and beyond. The analyst lowered his price target to $73 from $78. 5. Community Bank System (CBU) downgraded to Sell from Hold at Sandler O'Neill. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

01/12/17

JPMS

01/12/17NO CHANGETarget $124JPMSOverweight

JPMorgan ups Disney target to $124 on 'healthy' trends

Disney's underlying business trends continue to be healthy, JPMorgan analyst Alexia Quadrani tells investors in a research note. She raised her price target for the shares to $124 from $118 and reiterates an Overweight rating on the name. Pivotal Research this morning downgraded the stock to Sell citing a riskier political environment in the U.S. Quadrani says Disney is one of the best-positioned companies in her media universe given its "diverse portfolio of assets and unparalleled intellectual property." She admits, however, that the company's Q1 is likely to be a "light quarter" due to certain timing shifts and difficult comparisons.

01/12/17

PIVT

01/12/17DOWNGRADETarget $85PIVTSell

Disney downgraded to Sell from Hold at Pivotal Research

Pivotal Research analyst Brian Wieser downgraded Disney (DIS) to Sell and other names in the Internet/Advertising space citing a riskier political environment post the U.S. election. Valuations do not appropriately reflect that the environment for stocks and companies is riskier now than was the case several months ago, Wieser tells investors in a research note. He believes "significant factions" within the government support "mercantilism and populism," creating uncertainty as to what policies will take effect. The analyst lowered his price target for Disney shares to $85 from $102. The stock closed yesterday up $1.06 to $109.44. Twitter (TWTR) and CBS (CBS) were among the other names Wieser downgraded this morning.

LBTYALiberty Global

$34.91

0.9 (2.65%)

06/22/16

JEFF

06/22/16NO CHANGEJEFF

Liberty Global outlook remains upbeat, says Jefferies

Jefferies concedes that Liberty Global (LBTYA) is off to a slow start this year, but the firm thinks that the company's price hikes will improve its results later in 2016. Moreover, the firm remains upbeat on the company's footprint expansion in the U.K., and it says that Virgin Media's (VMED) position in the U.K. remains strong. Jefferies cut its price target on Liberty Global to $46 from $53 but keeps a Buy rating on the shares.

Drexel Hamilton analyst Tony Wible said Liberty Global's (NFLX) announcement that it will integrate Netflix (NFLX) into all its set-top boxes signifies a shift for multichannel video programming distributors, or MVPD, focus, and changes the competitive advantages for other MVPDs. Wible said Liberty's move will force others to integrate Netflix, and those that don't will be at a competitive disadvantage. The analyst believes the most underappreciated aspect of Netflix integration will be the effect on viewing and the increased use in integrated homes as more content becomes accessible, perpetuating the vicious cycle that helps propel Netflix's business and driving competitors to switch their distribution model that favors the company. Wible rates Netflix a Buy with a $110 price target on shares.

12/06/16

SOCG

12/06/16INITIATIONTarget $48SOCGBuy

Liberty Global initiated with a Buy at Societe Generale

Societe Generale initiated Liberty Global with a Buy and a $48 price target.

CMCSAComcast

$71.71

0.79 (1.11%)

12/13/16

12/13/16UPGRADETarget $24Buy

SeaWorld upgraded to Buy on better Orlando outlook at Janney Capital

As previously reported, Janney Capital analyst Tyler Batory upgraded SeaWorld (SEAS) to Buy from Neutral based on his expectation for better performance from its Orlando park given a recent price increase, which he views as sustainable given the company's recent investments and upcoming virtual reality plans. He also believes the drive and overnight segment can help offset some competitive pressures from Disney (DIS) and Universal's (CMCSA) parks and raised his fair value estimate on SeaWorld shares to $24 from $16.

01/03/17

BTIG

01/03/17NO CHANGEBTIG

BTIG views Zayo as potential target for cable operators

An acquisition of Zayo Group (ZAYO) could extend the fiber footprint of cable operators like Comcast (CMCSA), BTIG analyst Walter Piecyk tells investors in a research note. He views Zayo's $13B enterprise value as "digestible" for the cable companies, but notes Verizon Communications (VZ) or Crown Castle (CCI) could be interested in a competitive bid should Zayo be "put in play." Shares of Zayo are up 16c to $33.02 in afternoon trading.

12/19/16

JEFF

12/19/16NO CHANGETarget $80JEFFBuy

Jefferies sees Comcast fears as overstated, ups target to $80

Jefferies analyst Mike McCormack raised his price target for Comcast to $80 from $77 saying fears of cord cutting and 5G competition are overstated. Comcast is positioned to add video subscribers for the second straight year while broadband adds should remain "robust" given speed investments and churn benefits, McCormack tells investors in a research note. He also believes investors should expect another double digit dividend hike. The analyst keeps a Buy rating on Comcast.

12/21/16

OPCO

12/21/16NO CHANGEOPCO

T-Mobile could be worth $80/share in potential takeover, says Oppenheimer

Oppenheimer analyst Timothy Horan continues to believe that either Comcast (CMCSA; CMCSK) or Sprint (S) is the likely merger partner for T-Mobile (TMUS), potentially prompting a bidding war. Moreover, the analyst believes it is not unreasonable for Comcast or Sprint to pay $80/share for T-Mobile, or even higher. Commenting on Microsoft's (MSFT) valuation, Horan says he examined the sum of its parts, valuing Azure, its Cloud Software, and "legacy Microsoft" to arrive at a conservative $70 valuation. Additionally, he sees a major inflection in top/bottom-line growth in 2019 as Microsoft's cloud services, specifically Azure, grow more rapidly/profitably than the Wall Street expects.

CMCSKComcast

08/22/16

PIPR

08/22/16NO CHANGETarget $27PIPROverweight

Piper Jaffray confident in Comcast signing with Rovi

Piper Jaffray analyst Michael Olson notes that Rovi (ROVI) announced a 10-year renewal with DISH (DISH) and while the terms were not disclosed, economics should be similar to recent deals, likely in the range of 21c-22c per subscriber per month. With DISH in the fold, nine of the ten major U.S. TV service providers now license Rovi guide patents, the analyst said, with Comcast (CMCSA; CMCSK) remaining the lone holdout. Olson believes discussions with Comcast are at the economic level, and is confident in Comcast signing, potentially in the first half of 2017. He reiterates an Overweight rating and $27 price target on Rovi's shares.

09/26/16

UBSW

09/26/16NO CHANGETarget $92UBSWNeutral

Consumer satisfaction with competitors has caught up to Netflix, says UBS

UBS analyst Doug Mitchelson said that the firm's Evidence Lab survey indicated that U.S. consumer satisfaction with Amazon Prime Video (AMZN) and Hulu - the joint venture owned by Time Warner (TWX), Comcast (CMCSA), 21st Century Fox (FOXA), and Disney (DIS) - has now caught up to Netflix (NFLX), advising that investors should "continue to monitor competitive threats closely" as Netflix leads the category but demand for consumer media time, attention and wallet has intensified. The analyst, who added that Netflix's "pricing power remains unclear" based on the firm's survey work, keeps a Neutral rating and $92 price target on Netflix shares.

Oppenheimer analyst Timothy Horan says Comcast (CMCSA; CMCSK) reported a "solid" Q3, but notes that shares were likely impacted by comments surrounding AT&T's (T) $35 Over The Top service, which will be a slimmed-down service designed to expand the overall market initially. While the analyst points out that the "legitimate concern" is a wireless acquisition of T-Mobile (TMUS), he thinks this is a 2018 event and that Comcast can integrate cellular/WIFI to create a unique service. Horan reiterates an Outperform rating and $74 price target on Comcast's shares.

TAT&T

$41.07

0.46 (1.13%)

12/23/16

12/23/16NO CHANGE

On The Fly: Top five analyst actions

Catch up on today's top five analyst upgrades, downgrades and initiations with this list compiled by The Fly: 1. Brean Capital analyst Alan Gould downgraded Time Warner (TWX) to Hold from Buy, saying the arbitrage discount to the AT&T (T) offer has shrunk to 12%, down from the high-teens, and Time Warner shares now trade above his fundamental value estimate in the low $90's. 2. Argus downgraded Sun Life Financial (SLF) to Hold from Buy, with analyst Jacob Kilstein citing valuation and what he sees as "weakness in the core Canadian business, lower margins, the negative impact of a strengthening Canadian dollar," along with the company's suspension of share repurchases. 3. FedEx (FDX) initiated with a Buy at Aegis. The firm also initiated shipping peer UPS (UPS) with a Hold rating. 4. Video game retailer GameStop (GME) initiated with a Buy at Mizuho, which also started coverage of video game makers Zynga (ZNGA) and Glu Mobile (GLUU) with ratings of Buy and Neutral, respectively. 5. Skechers (SKX) upgraded to Buy from Neutral at Monness Crespi. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

01/11/17

DBAB

01/11/17DOWNGRADETarget $43DBABHold

AT&T downgraded to Hold from Buy at Deutsche Bank

Deutsche Bank analyst Matthew Niknam downgraded AT&T to Hold after trimming his estimates to reflect weaker margins and slower earnings growth. The analyst notes this is his third downward estimate revision since October. A number of fundamental headwinds, including intensifying competition in wireless/linear video, is likely to pick up in 2017, Niknam tells investors in a research note. He views AT&T's risk/reward as more balanced at current levels and lowered his price target for the shares to $43 from $44.

01/11/17

01/11/17DOWNGRADE

On The Fly: Top five analyst downgrades

Catch up on today's top five analyst downgrades with this list compiled by The Fly: 1. Exxon Mobil (XOM) downgraded to Market Perform from Outperform at Wells Fargo with analyst Roger Read citing valuation and the absence of an acquisition during the downturn as a way to deliver growth and returns. The window for a deal has likely closed while Exxon trades at a "premium" valuation, Read tells investors in a research note. The analyst lowered his price target range for the shares to $87-$93 from $92-$100. Read's top pick in the International Exploration & Production space is Suncor (SU). 2. AT&T (T) downgraded to Hold from Buy at Deutsche Bank with analyst Matthew Niknam trimming his estimates to reflect weaker margins and slower earnings growth. The analyst notes this is his third downward estimate revision since October. A number of fundamental headwinds, including intensifying competition in wireless/linear video, is likely to pick up in 2017, Niknam tells investors in a research note. He views AT&T's risk/reward as more balanced at current levels and lowered his price target for the shares to $43 from $44. 3. Novartis (NVS) downgraded to Neutral from Outperform at Credit Suisse. 4. Scotts Miracle-Gro downgraded to Hold from Buy at SunTrust with analyst William Chappell citing valuation. 5. Pacific Continental downgraded to Neutral from Buy at DA Davidson and to Market Perform at Keefe Bruyette. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

TWXTime Warner

$94.02

0.34 (0.36%)

01/06/17

01/06/17UPGRADETarget $130Outperform

RBC Capital sees Disney sentiment improving, upgrades to Outperform

As previously reported, RBC Capital analyst Steven Cahall upgraded Disney (DIS) to Outperform from Sector Perform, as he believes sentiment on the media and theme park conglomerate is improving. Disney will enter a new round of affiliate deals late in this fiscal year, and as new deals are done affiliate revenue growth will accelerate, Cahall tells investors. A rotation out of Time Warner (TWX) will also likely be a source of funds for Disney investors, said Cahall, who added that Disney has the balance sheet strength "for any number of bolt-on or transformative acquisitions," and investors consider it a "good acquirer." The analyst raised his price target on Disney shares to $130 from $101.

01/03/17

EVER

01/03/17UPGRADETarget $108EVERBuy

Time Warner upgraded to Buy from Hold at Evercore ISI

Evercore ISI analyst Vijay Jayant upgraded Time Warner to Buy and raised its price target to $108 from $95.

AT&T Mobility has reached a tentative agreement with the Communications Workers of America in Mobility Orange contract negotiations. The four-year agreement, which will be submitted to the union's membership for a ratification vote in coming days, covers about 20,000 employees in 36 states and the District of Columbia - AT&T's Mobility Orange unit, which encompasses CWA Districts 1, 2-13, 4, 7 and 9.

Pfizer announced that the United States FDA has approved IXIFI, a chimeric human-murine monoclonal antibody against tumor necrosis factor, as a biosimilar to Remicade for all eligible indications of the reference product. The FDA has approved IXIFI as a treatment for patients with rheumatoid arthritis, Crohn's disease, pediatric Crohn's disease, ulcerative colitis, ankylosing spondylitis, psoriatic arthritis, and plaque psoriasis.

Western Alliance Bancorporation announced that during the first quarter of 2018 Robert Sarver will transition from Chairman and CEO to Executive Chairman. In conjunction with Sarver's change in role, Ken Vecchione will be promoted to Chief Executive Officer, Dale Gibbons to Vice Chairman and Chief Financial Officer, and James Haught to President and Chief Operating Officer, all effective April 1, 2018.

Aqua America announced that President and CEO Christopher H. Franklin has been elected chairman of the board, effective Jan. 1, 2018. Franklin became CEO in July 2015 and has served on the board of directors since October 2015. He succeeds Nicholas DeBenedictis, former CEO, who will continue to serve on the board as chairman emeritus.